Faisal Sheik, Average Dealer and king of the Mobile Business Dealer forum, just wants a level playing field for the independents and the chance to make lots of money.
I love New York! It’s so cool, so stylish, so diverse. However, I wish I could say the same for the rest of America. Don’t get me wrong – the people are amongst the nicest you’ll meet, but New York aside, America is just so boring!
Of course I’m generalising, but the first time I was asked to “say something, because your accent is so cool” was quite amusing, but after a while you really wanna cringe! And try eating out, when you’re being vegetarian (there’s no point trying to explain Halal or Kosher).
But what really puzzles me is the whole cellphone business.
For the world’s only superpower is light years behind when it comes to mobile. Europe now is at saturation point. But in the US mobile penetration is around 70% of the adult population. That still leaves over 30% of people without a mobile.
Imagine that situation in the UK. We take mobile ownership for granted; the mobile is no longer a luxury or the preserve of business – it’s a vital part of how we live our lives and for that, our industry needs to be congratulated.
You’d think our American friends would be keen to pick up a few lessons from how we do things over here. But what we’re seeing now is someone trying to force US cellphone culture on to the UK.
I recently read an interview with Jim Hyde, the new head of T-Mobile UK. Mr Hyde took over from Brian McBride earlier this year, and before that he’d worked with the network in the US. He was quite proud of his achievements in growing the US business, and he seemed quite keen to bring some of those ideas over here.
One factor he seemed keen to look at was the concept of how customers perceived their value trade-off between a calling plan and a handset. He argues that if you want the best price plan, you can’t then expect to get the best phone free of charge.
Now of course, this is a concept that UK customers have long been used to, but Mr Hyde feels that this needs changing: “The underlying value of the tariff pays the customer over time, even more so than a deeper original discount on the handset at the point of sale.”
Basically, if a customer is saving on monthly line rental, why should they mind paying for the best phones? Mr Hyde feels that a customer connecting to FlexT 35 should not expect to get a handset like a Sony Ericsson W810i free of charge, and so T-Mobile has set its commissions accordingly? Just to cover my costs, I’d need to charge a FlexT 35 customer £30 for the handset.
But the problem is that we’ve got one of the most competitive and established markets in the world, where customers expect a decent free handset! Compare the FlexT 35 deal when Orange offers 500 minutes, 500 texts, free 8MB home broadband, and a W810i or even a K800i free of charge for £35 a month. Which option seems more attractive?
But Jim Hyde seems to have a plan for that too. Because in a T-Mobile store, you can get a W810i free on FlexT 35, or a better phone if you want. And if you go direct, FlexT 35 only costs £30. Who cares that it’s called FlexT 35 – what’s in a name?
It gets better; after cutting commissions in June, then raising them by £50 in mid-August, then cutting them by £65 on 1 September, the T-Mobile short-termists then raised them by £30 to £45 as of 16 September. It’s like a f***ing pantomime:
“Commissions are down!”
“Oh no, they’re not!”
“Oh yes, they are!”
It’s the boom and bust economics of the early 1990s all over again. Is Mr Hyde really Norman Lamont in disguise? If the people at T-Mobile are being honest I’m sure they’d acknowledge and understand why dealers are pi$$ed!
It took years of hard-work for this industry to get to where we are; and there’s many reasons why America is years behind, and one of them is that the US networks did not do enough to encourage consumer take-up. The US networks badly let down the American cellphone industry. It’s wrong to try and drag us down to their level.
Of course I’m generalising, but the first time I was asked to “say something, because your accent is so cool” was quite amusing, but after a while you really wanna cringe! And try eating out, when you’re being vegetarian (there’s no point trying to explain Halal or Kosher).
But what really puzzles me is the whole cellphone business.
For the world’s only superpower is light years behind when it comes to mobile. Europe now is at saturation point. But in the US mobile penetration is around 70% of the adult population. That still leaves over 30% of people without a mobile.
Imagine that situation in the UK. We take mobile ownership for granted; the mobile is no longer a luxury or the preserve of business – it’s a vital part of how we live our lives and for that, our industry needs to be congratulated.
You’d think our American friends would be keen to pick up a few lessons from how we do things over here. But what we’re seeing now is someone trying to force US cellphone culture on to the UK.
I recently read an interview with Jim Hyde, the new head of T-Mobile UK. Mr Hyde took over from Brian McBride earlier this year, and before that he’d worked with the network in the US. He was quite proud of his achievements in growing the US business, and he seemed quite keen to bring some of those ideas over here.
One factor he seemed keen to look at was the concept of how customers perceived their value trade-off between a calling plan and a handset. He argues that if you want the best price plan, you can’t then expect to get the best phone free of charge.
Now of course, this is a concept that UK customers have long been used to, but Mr Hyde feels that this needs changing: “The underlying value of the tariff pays the customer over time, even more so than a deeper original discount on the handset at the point of sale.”
Basically, if a customer is saving on monthly line rental, why should they mind paying for the best phones? Mr Hyde feels that a customer connecting to FlexT 35 should not expect to get a handset like a Sony Ericsson W810i free of charge, and so T-Mobile has set its commissions accordingly? Just to cover my costs, I’d need to charge a FlexT 35 customer £30 for the handset.
But the problem is that we’ve got one of the most competitive and established markets in the world, where customers expect a decent free handset! Compare the FlexT 35 deal when Orange offers 500 minutes, 500 texts, free 8MB home broadband, and a W810i or even a K800i free of charge for £35 a month. Which option seems more attractive?
But Jim Hyde seems to have a plan for that too. Because in a T-Mobile store, you can get a W810i free on FlexT 35, or a better phone if you want. And if you go direct, FlexT 35 only costs £30. Who cares that it’s called FlexT 35 – what’s in a name?
It gets better; after cutting commissions in June, then raising them by £50 in mid-August, then cutting them by £65 on 1 September, the T-Mobile short-termists then raised them by £30 to £45 as of 16 September. It’s like a f***ing pantomime:
“Commissions are down!”
“Oh no, they’re not!”
“Oh yes, they are!”
It’s the boom and bust economics of the early 1990s all over again. Is Mr Hyde really Norman Lamont in disguise? If the people at T-Mobile are being honest I’m sure they’d acknowledge and understand why dealers are pi$$ed!
It took years of hard-work for this industry to get to where we are; and there’s many reasons why America is years behind, and one of them is that the US networks did not do enough to encourage consumer take-up. The US networks badly let down the American cellphone industry. It’s wrong to try and drag us down to their level.
DEAL DOSSIER
THIS MONTH’S TOP THREE DEALS
1 Orange SPV M3100 Free on Orange Panther £45, with 800 minutes and 200 SMS and free Home Broadband! Excellent value. £85 net profit before bonuses.
2 Nokia N93 Free on Vodafone Anytime 800 with three extras. So how about 1200 minutes, 250 texts and Vodafone Stop-the-Clock all for £50 a month. £80 margin using Vanilla.
3 T-Mobile’s Web’n’Walk Pro Data Card. I know it’s finishing soon, and there are teething issues with HSDPA connectivity, and it’s a two-year contract to get it free – but at £20 per month it’s a genuine home broadband replacement.
THIS MONTH’S TOP THREE DEALS
1 Orange SPV M3100 Free on Orange Panther £45, with 800 minutes and 200 SMS and free Home Broadband! Excellent value. £85 net profit before bonuses.
2 Nokia N93 Free on Vodafone Anytime 800 with three extras. So how about 1200 minutes, 250 texts and Vodafone Stop-the-Clock all for £50 a month. £80 margin using Vanilla.
3 T-Mobile’s Web’n’Walk Pro Data Card. I know it’s finishing soon, and there are teething issues with HSDPA connectivity, and it’s a two-year contract to get it free – but at £20 per month it’s a genuine home broadband replacement.
GRIPE LINE
THIS MONTH’S TOP THREE GRIPES
1 Network attitudes towards unlocking. It’s not illegal! In fact, many would argue that locking phones is an infringement of consumers’ rights. Time for an open and honest debate, methinks …
2 Networks not doing enough to tackle fraud. Why are dealers expected to be police officers?
3 Manufacturers announcing phones months before any potential release date. Sony Ericsson P990i is a classic example. It feels old already! Well done Samsung for consistently quick releases.
Top Jaffa:
Sid Abey at Hugh Symons – how many DM’s would stay at your store till 11pm on a Friday night, helping you check through commission queries? And all for a dodgy pizza, which took ages getting delivered!.